Monday, October 10, 2011

Sometimes the Good Guys Really Do Win!

This is my trading record of the past 5 or 6 days since I began trading the E-mini S&P 500 Futures Contract (ES). There was no school today so I have enjoyed trading at a more leisurely pace.

Honestly, I doubt I will have a week like this past week any time soon, so I figured I better post this so I can look back and say to myself, "remember that week in October, 2011"?

And yes, I had one losing trade. That looks like last Thursday at 1:30 pm when my next class showed up at the conclusion of my lunch break. It's all about priorities and not always about winning - so I hit the button and logged out.

Anyway, I simply use the TSI (7,4) on a 1 minute chart. Nothing else. I hope my good fortune is an encouragement to you.


  1. Awesome results! I always enjoy your posts. Keep it up.

  2. Congratulation for your past profits!!!
    you are da mannn!!

    i told you, good trade will always come..


  3. I bet you didn't make half that amount teaching music!

  4. Congrats for your past gains!!!
    YOU are da MANNN!!!
    Thanks for the 2nd last post, still studying it now..

    Good trades will always come


  5. That is awesome. Have you ever thought about writing a automated trading system using the TSI indicator? I would think this divergence buy/sell signal you used on these ES trades would be relatively simple to code but the trendline breaks and the other signals would probably be pretty complicated.

  6. thank you, thank you, thank you,
    love the 1 min es divergences
    love the daily silver zero cross overs


  7. MrMiyagi - you are correct. It takes me about 2 weeks, not one week to make that amount.

    Anyway, it was a good week and there will be lows that come after the highs.

    Major League batters get on streaks where they are "seeing the ball" really well, then they go into mediocre slumps where the bat does not even hit the ball. I know this all too well.

    What does continually impress me is how well the TSI works when one is doing a good job of "seeing" where all the players are on the field.

    I hesitate to say this, but sometimes I just start to chuckle when I see how traders push the price in a particular direction or another because I am nearly certain they are going to walk right over the trap door and disappear. Then they walk over the trap door and guess what? yes, they then disappear.

    At other times I am convinced that somebody on the trading floor is thinking exactly what I am thinking, but instead of making it obvious to everyone they back away from the aggressor's charging at them - acting like they are scared to get hit.

    It's all a ruse, a bluff. Pure comedy.

    After the cat plays with the mice for a while the cat pulls the chord and the ton of bricks comes crashing down on every mouse in the house.

    Frankly, I find this whole thing amusing because I see it coming the entire time. But I guess what is obvious to me is not always obvious to another - and that is what makes a market.

    btw, I fall through trap doors all the time too!

  8. Well done John, good guy always win, Cheers
    Happy Trading

  9. Nice trading. Boy, does that feel good! I just started trading the es also (and the currency futures, which I have found to be a bit more predictable). I also use the TSI 7,4, and was wondering if you found one pattern to work better with the es mini than the others - i.e., zero line cross, trendline break, or divergence?

  10. Norman - thanks.

    War_Eagle - I know a mountain with the same name.

    The trend line break, I think, works best. But even better when you get a combination of two or three signals more or less all at once.

  11. I'm new to reading this blog so I have a basic question. I trade using TradeStation as my platform and have begun trading the ES minis. TradeStation has a boatload of indicators available but TSI is not one of them. Does TSI go by another name? Or, is thre another place for me to go to get the current TSI for the eminis? Any ideas would be helpful to me. Thanks!!

  12. Pete - I am not familiar with TradeStation but I would be extremely surprised if someone has not already written the TSI for that platform. Normally there is a location on a platform's website where individuals post their custom indicators for the purpose of sharing with other users of the platform. I encourage you to explore this possibility. Another thought is that your could Google 'True Strength Index indicator' TradeStation and see what turns up. Gotta teach class now. Good luck!

  13. John, great suggestion! I did in fact find that someone had created the TSI indicator for TradeStation and offered it as shareware. Just loaded it - thanks!!

  14. I just successfully did this trade twice at 11:00 and 11:15! Too bad I have a job like you and can't be on the lookout for these trades that often.

  15. Hey pete
    I was going to ask the same question tonight!!!
    Im with daniels and my broker just told me to ask John for the code.
    pete can you point me to where to find it?
    Jeff A

  16. The formula for TSI is:

    TSI = ExpMovAvg(ExpMovAvg(NetChange, Long),Short) / ExpMovAvg(ExpMovAvg(AbsNetChange(n), Long),Short)

    Long = Long Period
    Short = Short Period
    NetChange = Price - Price 1 bar ago
    AbsNetChange = Absolute value of Price - Price 1 bar ago

  17. Thankyou John. Im eagger to get it loaded and start playing with it. Im gong to try to give myself 30 days of observing. Although after 30 i will get a little impaitent
    thankyou jeff

  18. Jeff - you have a very smart plan. Been there, done that. Exactly. Do not put a penny into the market until you have really taken this seriously for a month and written down absolutely every trade.

  19. Hey John,

    Any updates on pms and mining shares....

  20. That is impressive to me since I find trading ES extremely difficult. Hopefully it wasn't just luck and you'll be able to keep it up!

  21. Tsi loaded on all Daniels platforms thanks to my broker arron kuck
    When I get home from vacation I'll get to work

  22. This has been a pretty good trade for me so far with about 80% success. I mostly trade at night and I wrote a little thinkscript strategy to alert me of potential trades so that I don't have to be sitting there staring at the charts waiting to make a trade.

  23. Hey john,

    You say you use TSI(7,4), yet all your charts show 4,7 after the words True strenght Index

  24. Hi John,

    Contratulations. Question - what do you use as you primary exit signals?


  25. Question:

    How do you set up you ES settings on Think or Swim? You say you use a 7,4 on the TSI on a 1 minute. When I add a TSI to the ES one minute, it defaults with just one line and the settings are 25,13,8 EMA. Do you know how to change it to the setting you use? Thanks.

    BTW.........loved your article on gold and silver......looks like another 50% retrace for silver, then off to the moon (again).